D 39 BU Business Management in the Built
D 39 BU – Business Management in the Built Environment Lesson Two : Environmental scanning and STEEP Analysis Adapted from the Heriot Watt University ppt slides 1
D 39 BU – Business Management in the Built Environment Diagram showing the process of strategic planning – a 7 -step model Vision & mission Swot analysis STEEP & Scenarios Planning feedback Strategic analysis & options decision making implementation Evaluation & monitoring 2
Business Management in the Built Environment A Model of Strategy Process The Built Environment Identifying Options Stakeholder Expectations Strategic Analysis Resource Capability Strategic Capability Strategy Implementation Strategic Choice Organisational Structure Selecting a Strategy 3
Business Management in the Built Environmental analysis MACRO ENVIRONMENT STEEP ANALYSIS SOCIAL Industry Environment POLITICAL Suppliers TECHNOLOGICAL Competitors ENVIRONMENTAL ECONOMICS Customers Pg 4 unit 5 4
Business Management in the Built Environment Auditing Environment Influences Strategic Analysis STEEP ANALYSIS POLITICAL SOCIAL TECHNOLOGICAL ECONOMICS ENVIRONMENTAL 5
Business Management in the Built Environmental analysis: The STEEP ANALYSIS SOCIAL values / demographics / life styles TECHNOLOGICAL new products / innovations / technological trends ENVIRONMENTAL ECONOMICS POLITICAL pressure groups / energy efficiency / resources recession / interest rates / inflation / tax election / policy / budget / legislation 6
Business Management in the Built Environment Auditing Environment Influences Strategic Analysis STEEP ANALYSIS When Should STEEP be used? § Times of Uncertainty § Times of Information Overload § Times of Disorganization 7
Business Management in the Built Environment Auditing Environment Influences Strategic Analysis STEEP ANALYSIS 1. Comprehend the element of the environment 2. Assess interrelationships between trends 3. Relate trends to issues 4. Forecast the future direction of issues 5. Derive implications 8
Business Management in the Built Environment Auditing the Built Environment SOCIAL Affordable Housing Strategic Analysis POLITICAL PFI / PPP TECHNOLOGICAL Systems Building ENVIRONMENTAL Waste Management ECONOMICS Recession Note: * PFI = Private Finance Initiatives PPP = Public Private Partnerships 9
Business Management in the Built Environment Auditing the Built Environment Affordable Housing Strategic Analysis Systems Building *PFI / PPP Recession Waste Management Note: * PFI = Private Finance Initiatives PPP = Public Private Partnerships 10
Business Management in the Built Environment Resource & Strategic Capabilities Strategic Analysis SWOT ANALYSIS STRENGTHS WEAKNESSES THREATS OPPORTUNITIES 11
Business Management in the Built Environment Resource & Strategic Capabilities Internal Audit STRENGTHS WEAKNESSES OPPORTUNITIES THREATS Positive Factors (Potentially) Negative Factors External Audit 12
Business Management in the Built Environment Resource & Strategic Capabilities STRENGTHS STAFF TURNOVER PROFIT GROWTH WEAKNESSES STAFF POOR MARKET LOW PROFIT INNOVATION OPPORTUNITIES DIVERSIFY ALLIANCES SKILLS FUNDING THREATS ECONOMY STAFF LEAVE TECHNOLOGY CASH FLOW SWOT Summary STEEP & SWOT Analysis / Interpretation 13
Business Management in the Built Environment STEEP & SWOT Analysis & Interpretation STEEP & SWOT Analysis / Interpretation Use in conjunction with other techniques Porter’s Five Forces Porter’s Generic Strategies Boston Consulting Group Matrix Diversification Analysis 14
Business Management in the Built Environment Analysis of strategic position of the organisation Identify key Forces through 5 -Forces structural analysis Audit the envm influences Strategic position Identify the firm’s position In the industry Examine and idendify Opportunities and threats Through SWOT Pg 2 of Unit 5 Examine the nature of envm 15
Business Management in the Built Environment Analysis of strategic position of the organisation Identify key Forces through 5 -Forces structural analysis Audit the envm influences Strategic position Identify the firm’s position In the industry Examine and idendify Opportunities and threats Through SWOT Pg 2 of Unit 5 Examine the nature of envm 16
Business Management in the Built Environment Michael Porter’s 5 forces Potential Entrants Threat of Entrants Suppliers Bargaining Power COMPETITIVE RIVALRY Buyers Bargaining Power Threat of Substitutes 17
Business Management in the Built Environment MICHAEL PORTER’S 5 FORCES MODEL /THEORY FOR STRUCTURAL ANALYSIS OF COMPETITIVE ENVIRONMENT 18
Business Management in the Built Environment Exam question: (for discussion) Critically appraise Porter’s five forces model, provide a view on the school of thought that underpins the model and explain how the model could be used by a built environment organisation to develop organisational strategy. REFER TO Pg : 4 -7 OF UNIT 5 (TEXT) This question will be discussed in lesson 5 19
Business Management in the Built Environment The Built Environment: The UK Construction Industry (GDP) STEEP ANALYSIS Public / Private (Spending) Civils Construction Housing R&M Strategic Direction (Markets / Portfolio / Competition) 20
Business Management in the Built Environment The Built Environment: The Singapore Construction Industry (GDP)? STEEP ANALYSIS Public / Private (Spending) Civils Construction Housing R&M Strategic Direction (Markets / Portfolio / Competition) 21
Business Management in the Built Environment Challenges in the Built Environment § Industry Statistics: (Companies / Employment) § Client Involvement: (Novice / Enlightened) § Characteristics: (Project-based / Sub-Contracting) § Procurement: (Contractual Governance / Route) § Modern Methods of Construction: (incl. Environmental) § Future Strategies: (Consolidation / Merger / Acquisition) 22
Business Management in the Built Environment Discussion & assignment (exam Question) As the senior executive of a built environment firm, critically appraise and discuss what you consider to be the key issues and their impact upon the environment within which the organisation competes. Furthermore clearly explain how these issues affect the organisation’s strategy. 23
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